Pakistan’s total external public debt stood at $77.9 billion as of June 30, 2020, compared to $73.4 billion a year ago, according to a new report released by the Ministry of Economic Affairs Division (EAD). Representing a surge of 6 percent over last year, the country’s current debt has largely been derived from taking loans on fixed interest rates.
The Ministry released its annual report on foreign economic assistance (FY 2019-20) on Friday. It highlighted the 6 percent increase in external public debt over last year, and noted that 70 percent of the debt consists of loans on fixed interest rates and the remaining 30 percent has been derived from loans obtained on floating interest rates.
In summary, Pakistan’s external public debt has been derived from the following three primary sources:
- 51 percent multilateral debt (including loans of IMF that comprise 10 percent of total debt)
- 31 percent bilateral debt (including China’s SAFE deposits that comprise 4 percent of total debt)
- 10 percent from foreign commercial banks
- 8 percent bonds (including Eurobonds and Sukuk)
The report went on to highlight the government’s signing of new agreements with various development partners in the fiscal year 2019-20 with a combined worth of $10.447 billion. Compared to last year’s figure of $8.4 billion, this represents a 23.8 percent increase.
The following is a breakdown of Pakistan’s largest development partners in terms of foreign economic assistance during the fiscal year 2019-20:
- Asian Development Bank with economic assistance worth $3.112 billion (30 percent)
- World Bank with economic assistance worth $2.239 billion (22 percent)
- Islamic Development Bank with economic assistance worth $756 million (7 percent)
- Asian Infrastructure Investment Bank with economic assistance worth $540 million (5 percent)
The report further noted that 69 percent of the new commitments during the fiscal year 2019-20 were made under the category of budgetary support. This high level of budgetary support was secured mainly to offset the socio-economic impact of the COVID-19 pandemic and to meet the higher external financing requirements for external debt retirements.
